This C-word is the most important in Recruitment Agency Agreements

Working with agencies globally, we consistently receive the same question.

“We have uncovered a backdoor hire. How do we approach the client?”

Our responsive is always to ensure the conversation is open, factual and non-accusatory (as the vast majority of times it is a genuine mistake). We see excellent outcomes consistently using this approach. The only caveat to this guidance is – ensure that you have an agreement in place with the client.

It sounds like a simple concept, however many agencies don’t put formal contracts in place with their clients, and still put their hand out requesting a fee. In almost all circumstances – this is exceptionally bad business.

An “agreement” implies that both parties understand the terms and AGREE to those terms.

There are many C-words when setting up and negotiating an agreement with a recruitment agency. Candidate ownership, candidate guarantee periods, commissions, contract length, contractor margins, the list goes on. I can hands down tell you the most important one for both the agency and the client.

Communication.

Yes the details are important. Yes the legalities need to be checked. And yes you want it bound by signatures from both parties.

BUT.. In order for relationships to be maintained, and to avoid disputes later on – all of the commercial terms need to be discussed, understood and agreed to. What does this mean practically?

For internal HR teams or hiring managers – this means not just sending the agreement to “legal”, to ensure the contract is legally sound. It means getting familiar with the terms and discussing with the recruiter specific hypothetical situations so you know where your company stands. Don’t be blindsided by the agency that sends speculative resumes, or refers to a legacy agreement agreed to by former employees. Know the terms and have an open, honest discussion about them with the agency.

For recruitment agencies, don’t hide in the shadows behind a contract. Or worse still, send an agreement after the job has been filled. Be transparent. Make sure your clients are aware of what candidate ownership means, and what an introduction consists of. Whilst you may miss out on one or two potential fills via a client turning away at this point – the reality is if the client is unwilling to have that conversation, they are probably an inefficient use of your time anyway.

Recruitment is the business of people. Making the legalese contextual, understood and most importantly – personal, should always be the ultimate goal of both the recruitment agency and the client.